FHA loan eligibility

[SG2013]

Hi, appreciate any input about fha loan eligibility and chanes of pre qualifying and successful UW.

Middle score above 640: 660, 648, 638.

Annual gorss income is 80k

CC's are paid off every month to 0 so no debt.

Combined car payment and student loans equal 1100 a month.

This is my only debt.

Looking at houses in the 2900k range.

Do have 2-3 lates on student loans from last summer (120days) caused by a slow down at my old place of employment. Cut me back to 3 days a week and I got behind but got caught up. These are the only derogatories on my report.

Reloacted to SC from OR about 7 months ago for a much higher paying job. My wife owned her own LLC in OR. She has yet to get established here in SC but travels back to OR often and generates approx 25k a year. She has perfect credit and we're hoping her income can improive our chances of qualifying.

My questions

What are my chances for approavl for an FHA loan with the above scores? Will those lates kill me or can I provide a LOE? Should we wait until the lates are at least 1 yr old?

Will my wife's income be included in the approval process even though her income is from an established business in a state where we no longer live?

Many thanks.

[tooleman694]

I think you are going to have to wait till the lates are 12 months old.

[CM1]

With a mid score over 640 you should be fine to qualify for a loan with that income.

[aerosarcasm]

Also, if you keep a balance on one credit card so that your utilization is between 1-9% instead of 0, you should see a score increase.

[SG2013]

Is that true about carrying a balance of 1-9% to see a score increase? Wouldn't that have a small negative effect on the credit used v. credit available?

[aerosarcasm]

If you check out the credit cards section of this board, there is a bunch of info of maximizing score and how zero utilization factors in.

[Sunshine85]

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@tooleman694 wrote:

I think you are going to have to wait till the lates are 12 months old.

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+1

Definitely wait until the lates have aged at least 12 months. The 120 day lates are going to be very concerning for an underwriter- especially since they were on installment loans. 

[SG2013]

The lates go back to Sept 12. I do have a LOE as my work hours were cut back to 24hr a week because the company was poorly managed. I'm hoping that, combined with an increasing income and a clean sheet since then will help.

[deg757]

I'm pretty sure that no late payments within the last 12 months is a requirement of an FHA loan. I don't think you will even be preapproved until they 12 months old. No way you will make it through underwriting until then.

[SG2013]

Is a 12-month clean sheet a hard and fast FHA req? After reading a ton of stuff online I don't see that mentioned anywhere with the excpetion of no lates on a rent or mortgage payment for a year. Many requirement sheets offered by a few lenders (ie Pinnacle Mortgage) make no mention of any specific req like that and say lates can be explained with LOEs. Are you saying it's more of a lender req like an min score of 640?